Disney: Media Opportunities

The featured stock - my pick for the #1 blue chip - is among the world's most recognized brands, notes growth and income expert Briton Ryle, editor of The Wealth Advisory.

The media division at Disney (DIS) includes ESPN and the Disney Channel, as well as its investment in Hulu. And as it happens, this is also the division that investors are questioning right now.

Cord cutting is what you call it when people stop buying bundled TV packages from their cable company. For Disney, this means the number of people getting ESPN right now is falling.

Where many people see a challenge for Disney, I see an opportunity. It is reasonable to think that Disney could attract more viewers for ESPN - and more money - if it could offer the sports network direct to consumers. Well, that's the plan.

Disney has bought 33% of Major League Baseball's the live streaming BAMTech. It's pretty easy to see Disney offering ESPN direct to consumers via the BAMTech platform.

Or it could offer a full Disney Channel that includes movies on demand, TV shows from Hulu (in which Disney has invested), and ESPN. However you slice it, there is opportunity here.

ESPN aside, everything else is going gangbusters for Disney. There's a new Star Wars movie, Rogue One, coming this December. And the next movies from Marvel will do well, too.

Meanwhile, Shanghai Disney just opened this summer, and attendance numbers look fantastic.

Estimates are that 50 million people will visit in the next year. That's just about how many people visit all four of Disney's theme parks in Orlando every year.

Right now, Disney is paying $1.42 a year in dividends. That's just 25% of its earnings per share, pretty low on the scale. Disney's dividend is going to be hiked.

My best guess is that future announcements regarding its media operations will come when Disney announces fiscal 2016 numbers on November 10.

You could wait to buy the stock then. But I bet you the shares will be higher than now. I have a 12-month price target of $130.